What Could the 2026 Housing Market Really Look Like?

When rates move, headlines start buzzing and everyone suddenly has a “prediction” for the housing market. Some people are certain a crash is coming. Others are convinced prices will only go up from here.

The truth?  No one has a crystal ball.

But we do have data, trends, and forecasts from some very smart (and very nerdy) housing economists.

Let’s walk through what the experts are actually saying about the 2026 housing market—and what that might mean for you if you’re planning to buy, sell, or refinance in the next couple of years.

As of late 2025:

• The average 30-year mortgage rate is hovering a little above 6%, after easing down from higher levels earlier in the year. AP News

• Home price growth has cooled from the big run-up years. Nationally, prices are up around 2–2.3% year over year—much slower than the double-digit gains we saw in 2021–2022.

• Home sales are still below “normal” levels, mostly because affordability is tight and many homeowners are holding on to their super-low pandemic-era rates. 

So we’re in a strange in-between moment: not a crash, not a boom—more like a slow, sticky market that’s trying to rebalance.

Different organizations run their own models, so the numbers don’t match perfectly—but the overall theme is pretty consistent: modest improvement, not fireworks.

 Home Prices: Low Single-Digit Growth

• The National Association of Realtors (NAR) is calling for about 4% national home-price growth in 2026, after an estimated 3% in 2025. 

• Fannie Mae’s latest outlook is more cautious, expecting roughly 1–1.3% home-price growth in 2026, slower than 2024 and 2025. 

• FHFA’s own forward-looking estimates point to home-price growth in the 1.5–2.1% range in 2025–2027. 

Most economists are expecting small, positive price growth—not a major drop, and not another rocket ship.

Local markets will still vary. Some overheated pockets may flatten or dip a bit; more affordable markets may see steadier gains.

 Mortgage Rates: Slightly Lower, Not “Back to 3%”

Several big forecasters are relatively aligned on rates:

• Fannie Mae projects the 30-year fixed rate to drift down to about 5.9% by the end of 2026. Fannie Mae+2ResiClub+2

• Other forecasts are in the same ballpark—some slightly higher, some slightly lower—but no one reputable is expecting a return to the 2–3% environment anytime soon.

Think of it as a “new normal” range: mid-5s to low-6s, depending on your exact timing and profile.

 Sales & Activity: A Slow “Thaw,” Not a Frenzy

• Fannie Mae recently trimmed its 2026 home-sales forecast but still expects sales to rise about 7% compared to 2025—a recovery, just slower than originally hoped. RealEstateNews.com

• The Mortgage Bankers Association expects total single-family mortgage originations to grow around 8% in 2026, as slightly lower rates bring more buyers and refinancers back into the market. MBA

We’re more likely heading into a “slow comeback” than a wild boom or sudden collapse.

• Affordability may improve a little, but not magically. Slightly lower rates plus slower price growth can help, but monthly payment comfort will still be key.

• You might see more inventory as some homeowners finally decide to move, but we’re not expecting a massive flood of listings.

• The bidding-war chaos of 2021 probably doesn’t return nationwide—but good homes in good areas will still attract strong interest.

This is a season where preparation (credit, savings, clear budget) matters more than trying to “time the market.”

• You may not see the sky-high appreciation of a few years ago, but values are expected to hold or grow modestly in most areas.

• Buyers will be more payment-sensitive, so pricing and presentation will matter more than simply “put it on the market and wait.”

• Many homeowners with ultra-low rates will still feel “locked in,” which is one reason forecasts don’t show an explosion of listings.

There’s also a growing trend toward renovating instead of moving, especially among owners who love their rate but not their layout—something major retailers and housing research centers are expecting to ramp up into 2026. 

Forecasters are smart, but they’re not fortune-tellers. A few big variables could shift the picture:

• Inflation and how the Federal Reserve responds

• Job growth or job losses in specific regions

• New home construction and building costs

• Insurance costs, taxes, and local policy changes

• Any larger economic shocks (geopolitical events, recessions, etc.)

That’s why it’s wise to treat predictions as scenarios, not guarantees.

The clearest theme across the 2026 housing forecasts is this:

A gradual healing market—not a dramatic crash, not a runaway boom.

Expect:

• Slightly lower rates than today

• Low single-digit price growth nationally

• A slow increase in sales and activity

• Ongoing affordability challenges, especially for first-time buyers

If you’re thinking about buying or selling in the next year or two, the most helpful thing you can do isn’t to obsess over national predictions—it’s to get clear on your numbers, your timing, and your local market.